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TMI Blog1980 (9) TMI 238X X X X Extracts X X X X X X X X Extracts X X X X ..... MIAH, J.-T he appellant is a firm carrying on business at Mandi Anandganj, Barut, District Meerut in the State of Uttar Pradesh, and is a dealer as defined in the U.P. Sales Tax Act, 1948 (Act No. 15 of 1948) (hereinafter referred to as "the Act"). It has filed this appeal by special leave under article 136 of the Constitution against the order dated July 31, 1979, passed in Appeal No. 1502 of 1978 on the file of the Assistant Commissioner (judicial), Sales Tax, Meerut Range, Meerut, upholding the inclusion of the market fee and the commission (otherwise called "dami") payable to the commission agent operating within a market area established under the U.P. Krishi Utpadan Mandi Adhiniyam, 1964 (U.P. Act No. 25 of 1964) (hereinafter referred to as "the Adhiniyam"), in the turnover of purchases of the appellant for purposes of levy of sales tax under section 3-D of the Act. The assessment year in question is 1974-75. The appellant was granted leave to appeal to file the above appeal directly against the order of the Assistant Commissioner (judicial) since the question involved in this case had already been decided by the High Court of Allahabad in Durga Das Narain Das v. State of U ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the levy of additional tax on certain dealers was introduced into the Act by U.P. Act No. 3 of 1971. When it was so introduced it provided that every dealer liable to pay tax under section 3, section 3-A, section 3-AA or section 3-D, whose total turnover of sales or of purchases or of both in any assessment year exceeded rupees two lacs would, in addition to the said tax, be liable to pay for that assessment year an additional tax at the rates specified therein in respect of his turnover liable to tax subject to the other provisions contained in that section. We shall hereafter refer to some of the provisions of the Adhiniyam and the Rules made thereunder. Clauses (b) and (e) of section 2 of the Adhiniyam define the expressions "broker" or "dalal" and "commission agent " or "arhatiya" respectively. "Broker" or "dalal" means a person who, in the ordinary course of business, negotiates or arranges contracts for the purchase or sale of agricultural produce, on behalf of his principal on payment of commission or remuneration, whether in cash or kind, but does not include the servant of such principal whether engaged in negotiating or arranging such contracts. "Commission agent" ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , as follows: "17........................................ (iii)........................................ (b) market fee, which shall be payable on transactions of sale of specified agricultural produce in the market area at such rates, being not less than one per centum and not more than one-and-a-half per centum of the price of the agricultural produce so sold, as the State Government may specify by notification, and such fee shall be realised in the following manner- (1) if the produce is sold through a commission agent, the commission agent may realise the market fee from the purchaser and shall be liable to pay the came to the committee; (2) if the produce is purchased directly by a trader from a producer the trader shall be liable to pay the market fee to the committee; (3) if the produce is purchased by a trader from another trader, the trader selling the produce may realise it from the purchaser and shall be liable to pay the market fee to the committee; and (4) in any other case of sale of such produce, the purchaser shall be liable to pay the market fee to the committee." Rule 79(1) of the Rules framed under the Adhiniyam for purposes of section 10 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ), no tax can be levied under any other provision of the Act. But section 3-F of the Act which was introduced into the Act subsequently by U.P. Act No. 3 of 1971 provides that every dealer liable to pay tax under section 3, section 3-A, section 3-AA or section 3-D whose total turnover of sales or purchases or of both in any assessment year exceeds rupees two lacs shall, in addition to the said tax, pay for that assessment year an additional tax at the rate specified therein. Since section 3-D of the Act is expressly mentioned in section F, it has to be held that section 3-F overrides sub-section (4) of section 3-D and that additional tax can be collected even in respect of the turnover of-purchases of goods notified under section 3-D(1) notwithstanding sub-section (4) of section 3-D of the Act. It cannot be said that by enacting sub-section (4) of section 3-D, the State Legislature forfeited its power to levy any other tax under the Act on the goods notified under section 3-D(I) for ever. It is always open to the legislature to modify the effect of sub-section (4) of section 3-1) by a subsequent legislation. We do not, therefore, find any substance in the contention that additio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere bought or sold whether for cash or deferred payment or other valuable consideration and when a sale attracted purchase tax and the tax was passed on to the consumer what the buyer had to pay for the goods included the tax as well and the aggregate amount so paid would fall within the definition of "turnover". In the above case, the court was construing the meaning of the expression "turnover" appearing in a statute in which there was no provision authorising the seller to recover the sales tax payable by him from the purchaser although the price of the goods realised by him included the sales tax payable by him and thus he had passed on his liability to the purchaser. The next decision on which reliance was placed by the State Government is Delhi Cloth and General Mills Co. Ltd. v. Commissioner of Sales Tax, Indore [1971] 28 S.T.C. 331 (S.C.); [1971] Supp. S.C.R. 945. In that case this Court held that the expression "sale price" as defined in section 2(o) of the Madhya Pradesh General Sales Tax Act, 1958, included the sales tax collected by a dealer from his purchaser as there was no provision in that statute imposing any liability on the purchaser to pay the tax imposed by it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Government from time to time, on the price of the liquor so sold. " In the course of the decision in the case of Spencer Co. [1975] 36 S.T.C. 188 (S.C.); [1975] Supp. S.C.R. 439., this Court observed thus: "It is clear from section 21-A of the Madras Prohibition Act, 1937, that the sales tax which the section requires the seller of foreign liquor to collect from the purchaser is a tax on the purchaser and not on the seller. This is what makes the authorities on which counsel for the appellants relied inapplicable to the cases before us. Under section 21-A the tax payable is on the price of the liquor and that tax is to be paid by the purchaser; the seller is required to collect the tax from the purchaser which he has to pay over to the Government. Section 21-A makes the seller a collector of tax for the Government, and the amount collected by him as tax under this section cannot therefore be a part of his turnover. Under the Madras General Sales Tax Act, 1959, the dealer has no statutory duty to collect the sales tax payable by him from his customer, and when the dealer passes on to the customer the amount of tax which the former is liable to pay, the said amount does ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d contention of the appellant that the commission (dami) payable by a purchaser to a commission agent operating within a market area established under the Adhiniyam cannot be treated as forming part of the turnover of purchases for two reasons- (i) the commission paid by the purchaser is not any tax or fee payable to a Government or statutory body which is not a party to the contract of sale and (ii) the commission is actually the profit of the dealer who in this case happens to be a commission agent and should, therefore, necessarily be considered as consideration for the sale of goods. The provisions contained in section 10 of the Adhiniyam and the Rules framed thereunder do not in any way affect the above conclusion reached by us. Section 10 of the Adhiniyam merely provides that as from the date to be notified by the State Government in the Gazette, no person shall, in a principal market yard or sub-market yard, levy, charge or realise, any trade charges other than those prescribed by rules or bye-laws made under the Adhiniyam, in respect of any transaction of sale or purchase of the specified agricultural produce and no court shall, in any suit or proceeding arising out ..... X X X X Extracts X X X X X X X X Extracts X X X X
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